Australian Regulator Backs Virgin Australia-Qatar Airways Alliance

The Australian Competition and Consumer Commission (ACCC) has given its backing to a proposed alliance between Virgin Australia and Qatar Airways, stating that the partnership would enhance service offerings and provide greater benefits to air travelers, according to Reuters.

The ACCC’s draft determination follows its interim approval in November, which allowed Virgin Australia to market and sell 28 weekly scheduled return flights between Doha and major Australian cities, including Brisbane, Melbourne, Perth, and Sydney. These flights, operated under a “wet lease” arrangement using Qatar Airways’ aircraft and crew, are expected to commence as early as June, per Reuters.

ACCC Commissioner Anna Brakey highlighted the potential advantages of the cooperation, noting that the partnership is likely to deliver significant public benefits. “We consider that the proposed cooperative conduct would likely result in several public benefits including providing enhanced products and services for air travellers which would include increased choice of international flights, with additional connectivity, convenience and loyalty program benefits,” Brakey stated.

Virgin Australia, the main domestic competitor to Qantas Airways, stands to gain from the partnership, which could bolster its international reach. Meanwhile, Qantas, which maintains an alliance with Dubai-based Emirates and an operational agreement with Finnair for flights between Sydney, Bangkok, and Singapore, has previously opposed Qatar Airways’ expansion efforts in Australia.

In addition to its partnership with Virgin Australia, Qatar Airways is awaiting government approval to acquire a 25% stake in the airline from Bain Capital, the U.S. private equity firm that currently owns Virgin Australia, per Reuters.

The ACCC has invited stakeholders to provide feedback on the draft determination before it issues a final decision, expected between March and April. The regulator’s preliminary approval has already been welcomed by Virgin Australia, which has confirmed that flights under the new alliance are now on sale.

Source: Reuters